India’s top lender, State bank of India (SBI) said on Wednesday (26) that its board has sanctioned a plan to sell four per cent share in its general insurance branch to the funds managed by India’s Axis Bank Ltd and Premji Invest.
According to a statement, SBI will divest 8.6 million shares in SBI General Insurance Company Ltd (SBI GI) for £50.46 million to Axis New Opportunities AIF-I and PI Opportunities Fund-I.
Axis New Opportunities AIF – I represented through its investment manager Axis AMC Ltd. and PI Opportunities Fund-I, an AIF of Premji Invest, will purchase 1.65 per cent and 2.35 per cent stake respectively from SBI. The proposed transaction values SBI general insurance at over Rs 120 billion.
Upon completion of the transaction, SBI will hold 70 per cent stake in SBI GI while its joint venture partner, IAG International Pty Ltd., will continue to hold 26 per cent.
Kotak Mahindra Capital Company Limited acted as the financial advisor for the transaction.
Commenting on the new deal, SBI Chairman Rajnish Kumar said,“…Insurance segment is still young and nascent in India, it is a highly under penetrated market, we foresee a significant scope of growth for SBI GI to achieve size, scale and profitability. We shall continue to extend our support and are excited about SBI GI’s bright journey ahead.”